Archive for July, 2018

An AWC was issued in which the firm was censured, fined $25,000 and required to provide a written certification to FINRA that its systems, policies and procedures, with respect to each of the areas and activities cited in the AWC, are reasonably Disciplinary and Other FINRA Actions 3 July 2018 designed to achieve compliance with applicable securities laws, regulations and rules. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to establish and maintain a supervisory system and WSPs reasonably designed to ensure that representatives’ recommendations of leveraged and inverse exchange traded funds (non-traditional ETFs) complied with applicable securities laws and NASD and FINRA rules. The findings stated that the firm did not have a supervisory system reasonably designed to enable the firm’s supervisory personnel to review non-traditional ETF transactions. The firm’s WSPs did not require supervisors to review open positions in non-traditional ETFs held for extended periods of time, or resulting in unrealized losses and did not impose product-specific limitations on firm representatives’ ability to recommend trading in or holding non-traditional ETFs. Additionally, prior to July 2015, the firm relied on supervisors to conduct a manual blotter review to detect potentially unsuitable non-traditional ETF transactions. Beginning in July 2015, the firm began using an exception report showing transactions in all ETFs, including non-traditional ETFs. This exception report did not show holding periods for non-traditional ETFs. (FINRA Case #2015043362701)

Securities arbitration and litigation on behalf of institutional investors, municipalities, high net worth investors, retail investors, individual investors, and employees in California, Texas, New York, Washington D.C. and around the country, including the major metro areas of Los Angeles, San Francisco, San Diego, Dallas, Houston, New York, and more. We are securities fraud lawyers/investment fraud attorneys focused on all types of financial fraud cases.